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For $30, you can have QT pro, which is a very good compressor for QT files. I use it for my video work and I think it's very nice. Especially for $30. (Note that this is just an upgrade from QT, so there's nothing much added, but the export options are great... lots of options, lots of formats, and works well.)

Windows Movie Maker should be able to export avi/wmv at different formats. Not too sure about this, though, as I use a mac for most of my editing.
(iMovie is the mac version of this, and it is nice for exporting QT files, but you need to have a mac to use it... it comes free with the OS.)

A great freeware application that can read AVI/WMV and QT (I think) and export AVI/WMV is called "Zwei-Stein" and it's a standalone editor (wtih a lot of features including greenscreening, etc.) and exports pretty well, especially considering the price.

There are of course more expensive video editors out there, but no need for those in this case.

Hope this helps. If not, give me more details, and I'll make a better suggestion.